The U.K's jobless rate – a key part of the Bank of England's interest rate policy – held steady in the three months to August, but the number of people claiming unemployment benefits fell much more than expected last month.
The unemployment rate remained at 7.7 percent between June-August, the Office of National Statistics said on Wednesday, with employment rising by 155,000. Youth unemployment was little changed, with 958,000 16-24-year-olds unemployed over the three months.
In September, however, the claimant count fell by 41,700 - the biggest monthly fall since June 1997.
"The U.K. is firing on all cylinders," Alan Clarke, U.K. and euro zone economist at Scotiabank. He had, however, expected a fall in the unemployment rate to 7.6 percent.
"Employment probably didn't pick up as much as it should have done," he said, highlighting that the claimant count comes out one month ahead of the broader unemployment rate. "It didn't happen today, but should do next month."
Sterling moved higher by over 0.16 percent against the dollar following the news.
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